La Senza: Theo to the rescue?

Downturn denial: is this turning into a trend? Theo Paphitis has become the second person in 24 hours to say that a crisis on the high street is being ‘talked up’ (the other, as avid MT readers will already know, was John Lewis MD Andy Street). But then, this is in the context of Paphitis considering a rescue of floundering lingerie chain La Senza, which has rather lost the twang in its elastic of late. The brand called in KPMG last week after it admitted that sales have dropped faster than a pair of loose-fitting panties over the past few months. In an interview with the Telegraph, though, Paphitis implied that it’s nothing to do with the consumer spending squeeze…

It’s become a part of modern business legend that Paphitis originally bought La Senza in 1998 for ‘£1 and a pack of Benson & Hedges’ (apparently he sent his driver out in the middle of negotiations to get the CEO another pack of cigs). Although he sold it to Lion Capital in 2006 in a £100m deal, Paphitis kept a seat on the board until 2009 – after which the chain began to go downhill. It sounds like for Paphitis, though, the pain of that is too much to bear. ‘It was my baby so it’s hard to see it floundering,’ he told the Telegraph. Bless.

To be fair to Paphitis, he’s used to this kind of thing. Not only is he a self-proclaimed ‘turnaround expert’ after he rescued stationary chain Ryman’s, but earlier this year, he launched another lingerie company, Boux Avenue, which is apparently going ‘brilliantly well’ (although it’s worth pointing out that that could create a bit of a conflict on interest). Still, there’s a sense that if anyone can sort out La Senza’s problems, he can. Although that’s once he’s identified exactly what those are. ‘We don’t know what the problem is yet,’ he shrugged. ‘It was an incredibly profitable business [in 2006] and remained so for several years afterwards.’

What’s clear is that he doesn’t think it’s got much to do with the problems retailers have spent the past few months moaning about. ‘When you look at the retailers that need to be put out of their misery, they should have been restructured a long time ago,’ he said. Which, if Paphitis does decide to swoop in and rescue the company, doesn’t bode well for La Senza’s management…